The French beauty giant said a newly created market in the Pacific and Middle East would form the bulk of L’Oreal’s new business.
The combined geographical zone – internally called SAPMENA – will cover 35 markets in the South Pacific, the Middle East and North Africa. Singapore’s headquarters have responded to shared consumer trends and growth opportunities, said the region’s president, Vismay Sharma.
“This region, or SAPMENA as we call it, is going to be a major growth engine for us. This is where we will reach the most consumers in the coming decade,” he told CNBC on Wednesday.
The move also makes demographic sense, Sharma said. Collectively, the region houses 40% of the world population with an average age of 28.
“More than 40% of consumers (in the region) are less than 25 years old,” he said. “It makes it extremely exciting for us and a very strategic market for the future.”
The 112-year-old company is trying to adapt to changing consumer habits and new markets, despite being kept relatively well during the pandemic. Sales increased by 10.2% in the first quarter of 2021 and returned to the pre-pandemic level.
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However, Sharma said the coronavirus crisis has promoted certain categories, including health and wellness and the demand for sustainable products.
Male cosmetics have also seen an increase in the demand for late. The Japanese beauty company Shiseido reportedly recorded a double-digit growth of one of its male makeup lines in 2020, as male consumers became more aware of their appearance during pandemic-induced video conferencing.
Sharma said he expects interest in male cosmetics to continue in the future, especially in the SAPMENA region.
Especially in Asia we can see that men are much more judicious about their skin, about the scents they wear, about their hair
Vismay Sharma
President (SAPMENA), L’Oreal
“In the past, men did not use enough beauty products. So the penetration was much lower, the per capita consumption was much lower, and the frequency of use was much lower,” he said.
Now, ‘especially in Asia, we can see that men are much more judgmental about their skin, about the scents they wear, about their hair,’ he continued.
“This part is getting extremely interesting. In terms of growth percentages, we are seeing significant growth coming from this part.”
To be absolutely sure, however, women will still have a significantly larger consumer base for beauty products for some time to come, he said.